10QSB 1 lum10q093002.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2002 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 0-28609 LUMINARY ACQUISITION CORPORATION (Exact name of registrant as specified in its charter) Delaware 52-2201516 (State or other jurisdiction (I.R.S. Employer of incorporation organization) Or Identification No.) 1504 R Street, N.W., Washington, D.C. 20009 (Address of principal executive offices (zip code) 202/387-5400 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the last 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. Class Outstanding at September 30, 2002 Common Stock, par value $0.0001 5,000,000 PART I -- FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS LUMINARY ACQUISITION CORPORATION (A Development Stage Company) As of September 30, 2002 (Unaudited)
ASSETS Cash $ 500 -------- TOTAL ASSETS $ 500 ======= LIABILITIES AND STOCKHOLDER'S EQUITY LIABILITIES $ - ------- STOCKHOLDER'S EQUITY Preferred Stock, $.0001 par value, 20,000,000 shares authorized, none issued and outstanding - Common Stock, $.0001 par value, 100,000,000 shares authorized, 5,000,000 issued and outstanding 500 Additional paid-in capital 1,330 Deficit accumulated during development stage (1,330) ------- Total Stockholder's Equity 500 ------- TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $500 =========
See accompanying notes to financial statements LUMINARY ACQUISITION CORPORATION (A Development Stage Company) Statement of Operations (Unaudited)
For the nine For the nine March 24, 1999 Months Ended Months ended (Inception)to Sept.30,2002 Sept.30,2001 Sept.30,2002 Income $ - $ - $ - Expenses Organization expense - - 580 Professional Fees - - 750 ---------- -------- -------- Total expenses - - 1,330 ---------- -------- ------- NET LOSS - - (1,330) ========= ======== =======
See accompanying notes to financial statements LUMINARY ACQUISITION CORPORATION (A Development Stage Company) Statement of Changes in Stockholder's Equity For the Period From March 24, 1999 (Inception) To September 30, 2002 (Unaudited)
Deficit Accumulated Common Stock Additional During Issued Paid-In Development Shares Amount Capital Stage Total Common Stock Issuance 5,000,000 $ 500 $ - $ - $ 500 Fair value of expenses contributed - - 1,330 - 1,330 Net loss for the periods ended: December 31, 1999 - - - (1,330) (1,330) December 31, 2000 - - - - - December 31, 2001 - - - - - Sept.30, 2002 - - - - - ------- ------- ------- --------- -------- BALANCE AT Sept.30, 2002 5,000,000 $ 500 $1,330 $(1,330) $ 500 ============== ========= ====== ======= ========= ========
See accompanying notes to financial statements
LUMINARY ACQUISITION CORPORATION (A Development Stage Company) Statements of Cash Flows Unaudited January 1, 2002 January 1, 2001 March 24, 1999 to to (Inception) to Sept.30, 2002 Sept.30, 2001 Sept.30, 2002 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ - $ - $ (1,330) Adjustment to reconcile net loss to net cash used by operating activities Contributed expenses - - 1,330 ---------- ------------ -------- Net cash used in operating activities - - - ---------- ------------ -------- CASH FLOWS FROM INVESTING ACTIVITIES - - - ---------- ------------ -------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock - - 500 ---------- ------------ -------- Net cash provided by financing activities - - 500 ---------- ------------ -------- INCREASE IN CASH AND CASH EQUIVALENTS - - 500 CASH AND CASH EQUIVALENTS BEGINNING OF PERIOD 500 500 - ---------- ----------- -------- CASH AND CASH EQUIVALENTS END OF PERIOD $ 500 $500 $ 500 ========== =========== ========
See accompanying notes to financial statement. NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (A) Organization and Business Operations Luminary Acquisition Corporation (a development stage company) ("the Company") was incorporated in Delaware on March 24, 1999 to serve as a vehicle to effect a merger, exchange of capital stock, asset acquisition or other business combination with a domestic or foreign private business. At September 30, 2002, the Company had not yet commenced any formal business operations, and all activity to date relates to the Company's formation. The Company's fiscal year end is December 31. The Company's ability to commence operations is contingent upon its ability to identify a prospective target business. (B) Use of Estimates The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. (C) Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. (D) Income Taxes The Company accounts for income taxes under the Financial Accounting Standards Board of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement 109"). Under Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under Statement 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. There were no current or deferred income tax expense or benefits due to the Company not having any material operations for the years ended December 31, 2001 and 2000. (E) New Accounting Pronouncements The Financial Accounting Standards Board has recently issued several new Statements of Financial Accounting Standards. Statement No. 141, "Business Combinations" supersedes APB Opinion 16 and various related pronouncements. Pursuant to the new guidance in Statement No. 141, all business combinations must be accounted for under the purchase method of accounting; the pooling-of-interests method is no longer permitted. SFAS 141 also establishes new rules concerning the recognition of goodwill and other intangible assets arising in a purchase business combination and requires disclosure of more information concerning a business combination in the period in which it is completed. This statement is generally effective for business combinations initiated on or after July 1, 2001. Statement No. 142, "Goodwill and Other Intangible Assets" supercedes APB Opinion 17 and related interpretations. Statement No. 142 establishes new rules on accounting for the acquisition of intangible assets not acquired in a business combination and the manner in which goodwill and all other intangibles should be accounted for subsequent to their initial recognition in a business combination accounted for under SFAS No. 141. Under SFAS No. 142, intangible assets should be recorded at fair value. Intangible assets with finite useful lives should be amortized over such period and those with indefinite lives should not be amortized. All intangible assets being amortized as well as those that are not, are both subject to review for potential impairment under SFAS No. 121, "Accounting for the Impairment of Long- Lived Assets and for Long-Lived Assets to be Disposed of". SFAS No. 142 also requires that goodwill arising in a business combination should not be amortized but is subject to impairment testing at the reporting unit level to which the goodwill was assigned to at the date of the business combination. SFAS No. 142 is effective for fiscal years beginning after December 15, 2001 and must be applied as of the beginning of such year to all goodwill and other intangible assets that have already been recorded in the balance sheet as of the first day in which SFAS No. 142 is initially applied, regardless of when such assets were acquired. Goodwill acquired in a business combination whose acquisition date is on or after July 1, 2001, should not be amortized, but should be reviewed for impairment pursuant to SFAS No. 121, even though SFAS No. 142 has not yet been adopted. However, previously acquired goodwill should continue to be amortized until SFAS No. 142 is first adopted. Statement No. 143 "Accounting for Asset Retirement Obligations" establishes standards for the initial measurement and subsequent accounting for obligations associated with the sale, abandonment, or other type of disposal of long-lived tangible assets arising from the acquisition, construction, or development and/or normal operation of such assets. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002, with earlier application encouraged. The adoption of these pronouncements will not have a material effect on the Company's financial position or results of operations. NOTE 2 STOCKHOLDER'S EQUITY (A) Preferred Stock The Company is authorized to issue 20,000,000 shares of preferred stock at $.0001 par value, with such designations, voting and other rights and preferences as may be determined from time to time by the Board of Directors. (B) Common Stock The Company is authorized to issue 100,000,000 shares of common stock at $.0001 par value. The Company issued 5,000,000 shares of its common stock to TPG Capital Corporation pursuant to Rule 506 for an aggregate consideration of $500. (C) Additional Paid-In Capital Additional paid-in capital at September 30, 2002 represents the fair value of services contributed to the Company by its president and the amount of organization and professional costs incurred by TPG Capital on behalf of the Company (See Note 3). NOTE 3 AGREEMENT On June 7, 1999, the Company signed an agreement with TPG Capital Corporation (TPG), a related entity (See Note 4). The Agreement calls for TPG to provide the following services, without reimbursement from the Company, until the Company enters into a business combination as described in Note 1(A): 1. Preparation and filing of required documents with the Securities and Exchange Commission. 2. Location and review of potential target companies. 3. Payment of all corporate, organizational, and other costs incurred by the Company. NOTE 4 RELATED PARTIES Legal counsel to the Company is a firm owned by a director of the Company who also owns a controlling interest in the outstanding stock of TPG Capital Corporation (See Note 3). ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Company was formed to locate and negotiate with a business entity for the combination of that target company with the Company. A combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange (the "business combination"). In most instances the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended. No assurances can be given that the Company will be successful in locating or negotiating with any target business. The Company has not restricted its search for any specific kind of businesses, and it may acquire a business which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict the status of any business in which the Company may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which the Company may offer. In implementing a structure for a particular business acquisition, the Company may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity. It is anticipated that any securities issued in any such business combination would be issued in reliance upon exemption from registration under applicable federal and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to register all or a part of such securities as part of the business combination or at specified times thereafter. Negotiations with a target company will likely focus on the percentage of the Company which the target company shareholders would acquire in exchange for their shareholdings. Although the terms of such agreements cannot be predicted, generally such agreements will require certain representations and warranties of the parties thereto, will specify certain events of default, will detail the terms of closing and the conditions which must besatisfied by the parties prior to and after such closing and will include miscellaneous other terms. Any merger or acquisition effected by the Company can be expected to have a significant dilutive effect on the percentage of shares held by the Company's shareholders at such time. Pursuant to Rules adopted by the Securities and Exchange Commission under Section 302(a) of the Sarbanes-Oxley Act of 2002, the principal executive and financial officer of the Company has certified the financial and other information contained in this report, has evaluated the effectiveness of the Company's disclosure controls and procedures within the period covered by this report, and has concluded that such disclosure controls and procedures are effective. There have been no significant changes in the internal controls of the Company or other factors that could significantly affect internal controls subsequent to the date of that evaluation. PART II -- OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS There are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it. ITEM 2. CHANGES IN SECURITIES Not applicable. ITEM 3. DEFAULTS UPON SENIOR SECURITIES Not applicable. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not applicable. ITEM 5. OTHER INFORMATION Not applicable. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K There were no reports on Form 8-K filed by the Company during the quarter. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. LUMINARY ACQUISITION CORPORATION By: /s/ James M. Cassidy President Dated: November 12, 2002 CERTIFICATION I, James M. Cassidy, certify that: 1. I have reviewed this quarterly report on Form 10-QSB. 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. As the registrant's sole certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including any consolidated subsidiaries, is made known to me, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report my conclusion about the effectiveness of the disclosure controls and procedures based on my evaluation as of the Evaluation Date; 5. As the registrant's sole certifying officer, I have disclosed, based on my most recent evaluation, to the registrant's auditors: a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls. 6. As the registrant's sole certifying officer, I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of the most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date 11/13/02 /s/ James M. Cassidy Chief Executive Officer/President Chief Financial Officer